To promote local manufacturing of mobile phone, Union government has launched a “Phased Manufacturing Programme.” Under this scheme, fiscal and financial incentives, would be given to companies that set up mobile manufacturing unit in India.
In last two years, 40 new mobile handset manufacturing units and 30 mobile components or accessory manufacturing units were set up. With this scheme government seeks to attract more companies and increase the number of manufacturing unit in India, said government.
The scheme which will be rolled out over a period of time, will cover mechanics, die cut parts, microphone & receiver, key pad and USB cable in the current financial year. While manufacturing of populated printed circuit boards, camera modules and connectors would be covered in 2018-19, the display assembly, touch panels, vibrator motor and ringer would be part of the scheme in 2019-20.
Government claims that as a result of implementation of phased manufacturing programme, the domestic value addition in manufacturing of feature phones will go up from about 15% to 37% and for smartphones, it will go up from about 10% to 26%.
Government says that the number will further go up with implementation of PMP-II, “this value addition will go up by 21.2% in feature phones and 13.3% in smartphones; thereby making the value addition of 58.3% in feature phones and 39.6% in smartphones,” said a statement. PMP-II is currently under preparation by the Fast Track Task Force, set up by Ministry of Electronics & Information Technology (MeitY)
According to government estimates, production of mobile handsets went up from 11 crore units valued at ₹54,000 crore in 2015-16 to 17.5 crore units valued at ₹90,000 crore in 2016-17. “As a result of increase in domestic production of mobile handsets, the share of imported mobile handsets in total domestic demand is gradually coming down. The import of mobile handsets decreased from ₹56,000 crore in 2015-16 to ₹40,000 crore in 2016-17, said MeitY.
“This initiative will give a huge impetus to local mobile manufacturing and will help us meet a significant portion of the global handset requirement over a period of time. It will also create an ecosystem, where due to the growth in local manufacturing, mobile phones will become cheaper and will be accessible to millions of Indians, in turn giving a huge boost to the digital payments initiative of the government,” said Aruna Sundararajan, secretary, MeitY.